Japan's Aso Pushes Back Against US Pressure for Bilateral Trade Deal

by Jimmie Castillo on 22/04/2017

The Trump administration has signaled its intention to use the dialogue to push for a two-way trade deal, while Japan wants to broaden the agenda to add less thorny issues like infrastructure investment.

The Japanese government is looking to implement the Trans-Pacific Partnership (TPP) free trade agreement among 11 remaining signatories after U.S. President Donald Trump pulled the United States out of the sweeping treaty earlier this year.

Japanese officials are indicating Tokyo intends to pursue the Trans-Pacific Partnership trade pact despite the US withdrawal from the agreement.

A new economic dialogue setting out parameters to enhance economic ties between Japan and the United States recently while on the one hand purports to chart a rosy bilateral trade understanding between both countries has also underscored some long-standing gulfs in economic objectives.

"Admittedly, on the surface, Japan and the USA are exceedingly close friends and allies, as evidenced by Abe rushing to the side of Trump as one of the first leaders to congratulate him after winning the presidential race and prior to that as a "friendly social call" as it was portrayed", Katayama said.

At the moment, the pact can not come into effect because the United States, which accounts for more than 60 percent of the combined GDP, has announced its withdrawal.

With a multilateral pact like the TPP, Mr Aso said that "Japan stands to gain from other countries, even if it loses out in some respects to other countries, like the US".

Within the Liberal Democratic Party, some have demanded the TPP come into effect with just the remaining countries so that "Japan will not be dragged into bilateral negotiations wanted by the United States", according to an LDP lawmaker lobbying for farming organizations.

The Japanese government also hopes that, should a USA-less TPP go into effect, the reduced import tariffs on member nation products such as Australian beef would put American imports at such a disadvantage that US exporters would demand their country join the TPP after all.

But Pence had clearly been appraised of Japan's inherent inclination to take care of its own and not necessarily work towards win-win deals. The administration of Prime Minister Shinzo Abe had previously indicated it was waiting for the U.S.to return.

"Today gives evidence of the fact that the United States of America is determined to reach out to our partners in the Asia Pacific and around the world to at least begin to explore the possibility of expanded economic opportunities including trade on a bilateral basis", he said.

The government, however, changed course to aim toward the idea of "TPP 11" - a name referring to the 11 nations other than the United States - due to two concerns it now has. It's trying to revive the TPP without the U.S.

"I don't see the comment as a problem as the U.S. Treasury secretary later clarified Washington's stance", Aso told reporters on Thursday, when asked about Trump's comment. "But, whether Japan and the US will reach an FTA, I will leave that to the future", Pence said.